By

October 9, 2013

The paralysis in Washington, brought to crisis levels by the Tea Party–led Republican shutdown, is having a crucial impact overseas, underlining the long-term decline of American influence abroad. The beneficiary: China, of course.

Meanwhile, the US-led “Doha Round” trade talks and the long-running American effort to create an anti-China trade bloc, the Trans-Pacific Partnership (TPP) are both going nowhere fast. China, taking advantage of its clout in the region and America’s decline, is proposing its own counter to the TPP, namely, the Regional Comprehensive Economic Partnership.

The inevitable decline of American influence and power, of course, is not going to be reversed by US military shows of force, such as the dangerously misguided, counterproductive and reckless interventions in Libya and Somalia this week. That impresses no one, except perhaps gullible viewers of Fox News. In the real world, fewer and fewer people are taking America seriously.

The most obvious result of the shutdown-cum-default crisis in Washington—which has drawn alarmed reactions in both Tokyo and Beijing—is that President Obama canceled his visit to Asia this week, including an important appearance at the Asia-Pacific Economic Cooperation (APEC) meeting in Indonesia, where in Obama’s absence China’s president, Xi Jinping, took center stage. As the New York Times reported, ruefully, Xi took over as “the dominant leader at a gathering devoted to achieving greater economic integration,” adding:

Mr. Xi, the keynote speaker, delivered a long, tightly scripted speech that made no reference to Mr. Obama and concentrated on the theme of Chinese economic overhaul at home, and the need for China to have the Asia-Pacific region as a partner abroad.

The Republican-induced government shutdown and the party’s threats to create another crisis next week over the debt ceiling are causing harm internationally as well as at home. They are undermining American leadership in Asia, impeding the functioning of the national security machinery, upsetting global markets and raising questions about the political dysfunction of a country that has long been the world’s democratic standard-bearer.

China is exercising its economic muscle throughout East Asia, becoming the most important trading partner for country after country in the region that is supposed to be the target of Obama’s vaunted “pivot.” (Instead, Obama finds himself bogged down in the Middle East and Afghanistan, dealing with the Syrian civil war, talks with Iran, a crisis in Afghanistan, and the military takeover in Egypt.) So, as the Times noted:

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Mr. Obama’s absence was particularly damaging to American interests here in Indonesia, where the growing economy has been bolstered by a stronger Chinese presence that until a few years ago was resisted, said John Kurtz, the head of the Asia Pacific region for A. T. Kearney, a global management consulting firm.

Mr. Xi visited Indonesia last week and announced that China would open a $50 billion infrastructure bank to service the region.

In its account of the APEC summit, the China Daily, an English-language newspaper in China, slammed the Trans-Pacific Partnership. It said the negotiations over it were “confidential talks” and the pact was “widely considered a new step for the United States to dominate the economies in the Asia-Pacific region.”

The Washington Post, in its report, says that China is rather unrestrained in its thrilled accounts of the sans-America meeting at APEC:

Chinese media gloated Tuesday over President Xi Jinping’s “star” performance at an Asia-Pacific trade summit in Indonesia that his American counterpart was unable to attend.

The Post report gave many examples of China’s reaction:

“Bipartisan games in the US have let the world see the worst of US democracy,” wrote senior commentator Huang Haizhen. “It is clear to other Asia-Pacific countries that America’s return [to Asia] strategy has become powerless.”

In an editorial, Wen Wei Po said the US “pivot” to Asia had undermined peace and stability in the region by encouraging Asian countries to see China as a threat and as the instigator in regional territorial disputes.

Now, the editorial said, more and more countries are “no longer being used by the US but are improving relations with China rationally.”

The United States, which had intended to wrap up the initial agreement on the TPP this year, now admits that it’s not going to happen. A big obstacle is that the TPP would stress the key role of dismantling state-owned enterprises, or SOE’s, which is a direct challenge to Vietnam, a socialist country that, like China, has many SOE’s in all fields of industry. As Reuters reports:

More intrusive than other trade pacts, the TPP seeks to regulate sensitive areas such as government procurement, intellectual property and the role of state-owned enterprises as well as giving corporations more rights to sue governments.

Inside Vietnam, of course, there’s a debate between pro-free market reformers and advocates of a socialist-based economy built around SOEs.

US Secretary of State John Kerry is moving his focus from trade to regional security matters as he fills in for President Barack Obama at back-to-back summits in tiny Brunei beginning Wednesday.

That’s because the United States hopes it can parlay its military power in the region, still overwhelming, into strengthening military alliances and relationships with Japan, Australia, the Philippines, Taiwan and other countries, including Vietnam, by raising the Chinese boogeyman. But, as the Journal notes, Xi knows that:

“China will firmly uphold regional peace and stability,” Mr. Xi said in a speech to business leaders at the APEC meeting Monday, for instance. “Without peace, development is out of the question, like water without a source or a tree without roots.”